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Otis Worldwide Beneish M-Score

: 0.00 (As of Today)
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The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score no higher than -1.78, which implies that the company is unlikely to be a manipulator.

During the past 3 years, the highest Beneish M-Score of Otis Worldwide was 0.00. The lowest was 0.00. And the median was 0.00.


Otis Worldwide Beneish M-Score Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Otis Worldwide Annual Data
Dec17 Dec18 Dec19
Beneish M-Score 0.00 0.00 0.00

Otis Worldwide Quarterly Data
Dec17 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.00 0.00 0.00 0.00 0.00

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


Otis Worldwide Beneish M-Score Distribution

* The bar in red indicates where Otis Worldwide's Beneish M-Score falls into.



Otis Worldwide Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Otis Worldwide for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * +0.528 * +0.404 * +0.892 * +0.115 *
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * +4.679 * -0.327 *
=

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep20) TTM:Last Year (Sep19) TTM:
Accounts Receivable was $2,901 Mil.
Revenue was 3268 + 3029 + 2966 + 3353 = $12,616 Mil.
Gross Profit was 979 + 891 + 897 + 966 = $3,733 Mil.
Total Current Assets was $6,271 Mil.
Total Assets was $10,473 Mil.
Property, Plant and Equipment(Net PPE) was $1,269 Mil.
Depreciation, Depletion and Amortization(DDA) was $185 Mil.
Selling, General, & Admin. Expense(SGA) was $1,868 Mil.
Total Current Liabilities was $6,291 Mil.
Long-Term Debt & Capital Lease Obligation was $5,887 Mil.
Net Income was 266 + 224 + 165 + 218 = $873 Mil.
Non Operating Income was -2 + -1 + 3 + -5 = $-5 Mil.
Cash Flow from Operations was 348 + 664 + 159 + 454 = $1,625 Mil.
Accounts Receivable was $0 Mil.
Revenue was 3313 + 3351 + 3101 + 0 = $9,765 Mil.
Gross Profit was 975 + 984 + 901 + 0 = $2,860 Mil.
Total Current Assets was $0 Mil.
Total Assets was $0 Mil.
Property, Plant and Equipment(Net PPE) was $0 Mil.
Depreciation, Depletion and Amortization(DDA) was $135 Mil.
Selling, General, & Admin. Expense(SGA) was $1,329 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt & Capital Lease Obligation was $0 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(2901 / 12616) / (0 / 9765)
=0.2299461 / 0
=

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(2860 / 9765) / (3733 / 12616)
=0.29288274 / 0.2958941
=

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (6271 + 1269) / 10473) / (1 - (0 + 0) / 0)
=0.28005347 /
=

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=12616 / 9765
=

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(135 / (135 + 0)) / (185 / (185 + 1269))
=1 / 0.12723521
=

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1868 / 12616) / (1329 / 9765)
=0.14806595 / 0.13609831
=

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((5887 + 6291) / 10473) / ((0 + 0) / 0)
=1.16279958 /
=

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(873 - -5 - 1625) / 10473
=-0.0713

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.


Otis Worldwide Beneish M-Score Headlines

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